MACo Supports Removing Administrative Burden in Property Tax Collection

MACo’s Associate Director, Kevin Kinnally, testified in support for HB 0165, Corporations and Associations – Fee for Processing Articles of Dissolution, Certificates of Cancellation, and Other Documents – Repeal, January 30, 2019.

This bill repeals a State Department of Assessments and Taxation (SDAT) processing fee. The fee is nonrefundable and is required for filing articles of dissolution (official document ending a business) and certifications of cancellation. These fees often remain unpaid, but responsibility for collecting them falls on county governments.

From the MACo testimony:

Under current law, business entities that file articles of dissolution and certificates of cancellation with SDAT must pay a $100 nonrefundable processing fee. Because SDAT has no enforcement mechanism, particularly with entities that are nearing a point of dissolution, many such entities simply avoid filing articles of dissolution and instead force the Department to commence a lengthy forfeiture process.

In the meantime, county governments may receive inaccurate assessment data, resulting in the issuance of property tax bills to entities that are no longer in business. As a result, county governments expend significant time and resources on fruitless and administratively burdensome attempts to collect delinquent property taxes.

For more on 2019 MACo legislation, visit the Legislative Database.

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